Profile - Mike Danby: High-tech logistics firm driving ahead despite a bumpy road

“IT’S really a bit like Star Wars in there,’’ said Mike Danby as we left the vast, hushed hall.

Darth Vader must have put down his light saber and pottered off for a sandwich, but there was no denying that Advanced Supply Chain’s operation had a touch of George Lucas about it. The space age had touched down on Bradford’s Euroway Trading Estate.

Mr Danby, the CEO, had just taken me on a leisurely tour of the logistics base of the future. It had the air of a vast palace, where workers used scanning systems that resembled giant wrist watches.

Their mission was a simple one – to stop trailers hitting the road with any unused space. It was the model of calm efficiency. If Britain is to escape from the shadow of recession, then this is just the type of high-tech business that must flourish. But even a relentless optimist like Mr Danby is worried about the economic mess in Europe.

“The crisis in Europe isn’t affecting our day-to-day business, but it does make you nervous,’’ he told me. “We’re opening a shed in Corby in the Midlands. We’re committing £5m of investment. For a business our size, that’s significant. We signed up for that a few weeks ago. You sign up, and you’re thinking, ‘What if Greece explodes, what if Italy and Spain goes down? Is my £5m going to drag me down as well?’

“You don’t know. If we could have put off our decision for this deal then we would have done. We can’t do it because there’s an anchor customer in there. We need to be taking stock next week. Life’s a risk, we just hope it turns out OK.”

The Corby base could employ up to 200 staff within 18 months, but Mr Danby might have to trim his plans if the economy goes into reverse.

When the boss of a fast-growing firm like Advanced Supply Chain expresses doubts about Britain’s future, you know we’re in for a bumpy ride.

As a “one-stop supply chain shop”, the company provides distribution and freight forwarding services for industry heavyweights such as Matalan, Asda, Makro and DFS. It employs 400 staff and turnover is set to rise from £25m to £35m next year. According to Mr Danby, this expansion has been driven by a willingness to put hard cash into training staff and improving the IT system.

“We’re taking market share away from our competitors,” he said. “We invest in our staff. We invest in our IT. We spend many hundreds of thousands of pounds a year on developing IT services. We also invest in our equipment, so it’s the best we can afford. You can give a service that is better than your competitors, but you can also drive cost out of the supply chain.

“The most expensive load you’ll ever carry is the one with nothing in it. It’s a ‘green’ system, and anything that’s green is often cheaper. We’re getting something like a third extra on our vehicles when compared with a typical transport company.”

Mr Danby prides himself on knowing which way the commercial wind is blowing. He’s recently signed a partnership agreement with Sinotrans, China’s largest logistics company. As a result, Advanced Supply Chain will work with Sinotrans to offer UK customers an end-to-end logistics service for the movement of goods to and from Asia; a region which is still growing as the eurozone stagnates.

Sinotrans has more than 100 distribution centres across China, with road, rail and river connections covering most of the country. This coverage means products can be sourced cost effectively from across China, and not just the coast.

Mr Danby said: “Most of the consumer goods are made in the Far East, with around 70 per cent coming from China. Sinotrans saw similarities with us, although they are probably about 1,000 times bigger than us.

“They’re a great partner to have because they’ve got river boats, ports and ships.”

He received a lesson in the brutality of market forces back in the late 1970s.

“I started out in the laboratory site at Burton’s manufacturing in Leeds,’’ Mr Danby recalled. “The day I walked into that place there were 12,000 people making men’s suits. One year later, there were 2,000 people. That gave me a clue as to where things were going. I could see that the future was not going to be manufacturing. I used some of my skills in the laboratory to get a job in quality control.

“I got an offer to go into logistics from one of our suppliers at the time. I decided the only way I was going to make any money was to do it myself. So in 1990, I kicked off a business on my own.”

After a stint as a production manager at one of the UK’s first garment processors, Mr Danby was headhunted to run Brentray Services in 1992, which was based in Hebden Bridge, West Yorkshire. Mr Danby and his business partner Glyn Rogan, who had joined the business in 1995, organised a management buyout. The pair became joint managing directors and major shareholders of the renamed Advanced Processing and oversaw the company’s move to much larger premises at Water Lane in Halifax, and a giant complex on the Euroway Trading Estate.

Logistics is an industry for team players, where all items must be tracked with precision.

“You can’t do it without the IT and the people smart enough to load your vehicles properly,” said Mr Danby. “We’ve got 300 people on the Euroway. In 2012 I’m a bit nervous because we’ve got so much growth planned, although we can cope with it. We’ve almost doubled turnover in two years.”

In common with many employers, he believes employment law is weighted in favour of the employee.

“We don’t employ people to sack them,’’ he said. “It costs an awful lot of money to go through a process of employing somebody. It costs an awful lot to train them. If they’re not good enough, it’s a failure on our part.

“But I don’t want to have that failure and on top of that the prospect of an employment tribunal that’s going to take up hours of managers’ time, just because some guy goes to a lawyer and it costs £10 to write me a letter. It’s the threat of the claim that gets you. It’s the cost of defending the case. So you take the view that, if you get a letter from a lawyer, you just pay out, and offer them £2,000 to go away. That’s a scandal isn’t it?”

Trade unionists and employment lawyers would doubtless argue that rules are needed to ensure staff aren’t fired on a whim. In these turbulent days, Mr Danby believes fortune favours the brave, even if you’re not armed with a light saber.

“The best advice I would give to anyone starting out in business, is take your opportunities,’’ he said. “That’s not easy, because that often involves taking big risks. You have to ask yourself, ‘What’s the worst that can happen?’

“It’s often not as bad as you think.”

Mike Danby: The CV

Name: Mike Danby

Title: Chief executive of Advanced Supply Chain, the transport, logistics and distribution company

Date of birth: March 6 1960.

First job: Laboratory technician. He spent 10 years with the Burton Group and Damart, where he specialised in laboratory and quality management.

Education: Open University

Favourite song: Wonderful World by Louis Armstrong

Favourite holiday destination: Buenos Aires

Last book read: The God Delusion by Richard Dawkins

Car driven: Audi A8

Thing you are most proud of: Being able to give people a chance.